Diales Compendium Issue 3 - Flipbook - Page 27
ISSUE 3
COMPENDIUM
Post-contract, all parties can be responsible for failures of
project management arising from:
• Lack of awareness or understanding of contract terms;
• Lack of experienced staff;
• Unrecorded verbal agreements;
• Parking contractual requirements ‘in good faith’;
• Supply chain mismanagement;
• Lack of a fit for purpose electronic project file structure.
As design progresses and is issued, the most common
causes of problems include:
• Lack of a realistic Information Requirements Schedule;
• Late design information;
• Inaccurate design information;
• Incomplete design information;
• Contradictory / incompatible design information;
• Late approval of contractor designs;
• Designs that ignore local regulations.
On a project of any complexity the programme
should be an essential tool in managing both
works and the design.
However, common errors include:
• Not following any express contractual requirements such
as for sectional completion;
• Using a flawed or inadequate baseline programme;
• Lack of regular programme updates;
• Failure to regularly monitor against programme;
• Unrealistic updates:
Under-reporting effects;
Slanting effects.
All projects carry elements of risk, especially in relation
to ground or weather conditions, resource availability and
resource cost escalation. All too often such risks are managed
without identifying them early enough, or fully anticipating
their potential, or with a flawed response to start with.
Whilst change may be considered inevitable and/or
desirable, mis-management often includes:
• Failure to limit the scope of change;
• Lack of timely quantification of time and cost effects;
• Exaggerated external pricing;
• Understated internal reporting;
• Denial of valid claims;
• Lack of / inexperienced staff:
to quantify and submit;
to review and respond.
issues such as claims for interest, instigation of dispute
procedures and even contractor failure.
Common errors include:
• Excessive use of ‘payments on account’;
• Inaccurate measurement and valuation;
• Omission / undervaluation of valid claims;
• ‘Cash flowing’ the contractor;
• Issues in relation to Payment Notice procedures;
• Late payment.
Problems that arise from the various examples
of pre- and post-contract failures such as set
out above do not have to lead to claims, but if
they do, parties often exacerbate the negative
effects by failures of claims management
such as:
•
•
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Contractor failures:
Late submission;
Exaggeration;
Poor preparation;
Flawed methods of delay analysis;
Using inaccurate records;
Using flawed methods of quantification;
An inability to quantify the effects of disruption.
Employer / Contract Administrator failures:
The self-defensive Contract Administrator;
Denial of valid claims;
Late recognition of valid claims;
‘kicking the can down the road’ until Final Account or
Completion.
• All parties:
Adversarial attitudes;
Lack of objectivity and use of exaggeration and emotive
language;
Unrealistic reporting;
Tactical invention of counterclaims.
Record keeping can be a key part of managing change and
limiting its scope for causing problems. Those records may
be of:
• Events;
• Effects;
• Resources;
• Allocation.
If a contractor cannot properly control, monitor and report its
costs then it will not only undermine its margins, but it may
resort to making claims to recover the loss. Common failures
of cost management include a lack of cost control; lack of
a properly detailed financial budget; failure to regularly
monitor costs against budget; and inaccurate reporting.
In relation to such records, change management can be
undermined by failures such as:
• Lack of records;
• Partial records;
• Inconsistent records that are hard to combine;
• The wrong type of records;
• Reliance on emails for saving data;
• Inaccurate / one-sided records such as minutes.
Processes around Interim Payments can be burdensome and
time consuming. Mismanaged, they can lead to a range of
Alongside records, contractual notices are a key component
for the successful resolution of any claims that arise.
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